Prior to the founding of GreenSky Credit, getting an instant retail loan for a big-ticket item was often a difficult ordeal. For many customers and many types of purchases, getting needed financing was virtually impossible. Many customers for big-ticket goods and services, such as home remodeling or siding replacement, had to put these purchases on their credit cards or save up the cash they would need to complete the project in question. And this ultimately led to billions of dollars per year in sales that simply didn’t materialize due to the fact that customers didn’t have the cash on hand to carry these projects out.
GreenSky hits on the winning formula
But in 2006, prodigious entrepreneur David Zalik hit on a winning formula for providing loans at the retail level for big-ticket purchases. He saw that home improvement companies were losing tremendous amounts of business due to a large number of customers simply not having the needed funds to complete large-scale home remodeling projects. Zalik’s key insight was twofold. First, he noticed that the majority of the customers who were doing five- and even six-figure home remodeling projects were in what the industry terms the prime borrower category. Second, the vast majority of these projects were actually net value creating, meaning that the cost of the projects was usually far less than the value that was added to the homes as a result.
These two factors combined to make these deals very attractive for lenders. But Zalik needed a way to bring together top-tier lenders with these prime borrowers at the point of sale where the loans would be almost certain to help push through deals that would have otherwise fallen through.
That was what the GreenSky platform did. Through a world-class app interface, the GreenSky lending platform allows retailers and contractors to instantly extend loan offers to potential borrowers on the spot. And unlike many other so-called instant loans, GreenSky Credit loans are truly instantly approved. The second that the loan amount is approved, the contractor can begin work or the retailer can complete the sale.
This has added billions in yearly sales to the home improvement industry and other retail sectors.